Lucy Freeman, WDC Education Chairman.

On the evening of February 5, a standing room only crowd of 140 people braved the bitter cold and wind to attend the Woman's Democratic Club's Educational Program on Campaign Finance Reform. The program featured Congressman Chris Van Hollen, Congressman John Sarbanes, and State Senator Jamie Raskin, all of whom have proposed legislation addressing different aspects of our broken campaign finance system. Charles Duffy, host of Montgomery County Cable TV's "Political Pulse," expertly moderated the panel. 

 

Moderator Charles Duffy and Congressman Chris Van Hollen

Charles Duffy set the stage with an explanation of the state of campaign finance reform law as a result of the U.S. Supreme Court's decision in

Citizens United v. Federal Election Commission. As Duffy explained,Citizens United allowed corporations, labor unions and non-profit organizations the ability to donate to independent expenditure "social welfare" organizations under IRS Code section 501(c)(4), which organizations have a right under the First Amendment to engage in political advertising and advocacy. In so ruling, the Court invalidated a section of the McCain-Feingold Campaign Finance Reform Act that prohibited such expenditures for campaign advertising within 30 days of a primary election. The "social welfare" organization at issue in Citizens United had used the funding to produce and air a film opposing Hillary Clinton's campaign for the presidency in 2008.

Speakers Congressman Chris Van Hollen, Congressman John Sarbanes and State Senator Jamie Raskin

Congressman Van Hollen also addressed the logical question as to why strictly political organizations, such as the one in question in Citizens United, qualify as "social welfare" organizations under Section 501(c)(4) in the first place. Congressman Van Hollen noted that he had filed suit against the Internal Revenue Service in an effort to compel the IRS to clarify discrepancies between the Internal Revenue Code and the IRS's guidance on the issue of what types of organizations qualify as 501(c)(4)s, but the Congressman agreed to drop the case (with a right to refile it) to permit the IRS to draft regulations to clarify the nature of organizations that qualify as "social welfare" organizations.

WDC President Beth Tomasello and Moderator Charles Duffy

The next speaker, Congressman John Sarbanes, is the sponsor of The Grassroots Democracy Act, which seeks to equalize the power of large dollar and small dollar donors and fundraisers.  Under The Grassroots Democracy Act, in federal elections, the federal government would match contributions up to $100 with public funds. The legislation would fund small, individual contributions at a 10-1 ratio for candidates who agree to a $100 contribution limit for all donations and at a 5-1 ratio for candidates who accept donations up to allowable legal limits. The legislation also would provide taxpayers with a $25 tax credit to help individuals afford to make small campaign contributions.

The goal of The Grassroots Democracy Act is to equalize the influence of small donors and grassroots fundraisers with the influence of large donors and outside spending by super PACs and 501(c)(4)s. As Congressman Sarbanes explained at the forum, The Grassroots Democracy Act would allow members of Congress to fundraise less, and also would make them beholden to the right constituency: the voters in their districts. By vastly multiplying the effect of grassroots fundraising, federal politicians can spend their time at house parties with their constituents (which the Congressman believes that every member of Congress would prefer) for the same amount of campaign funding that they might otherwise be offered or need to seek from large individual donors, PACs and other organizations seeking political influence. The Grassroots Democracy Act would allow federal candidates for office to refuse funding that may come with strings attached (or will appear to constituents as having strings attached), and to focus solely on the needs of their constituents while still adequately funding increasingly expensive political campaigns.   As Congressman Sarbanes noted, congressional campaigns now cost approximately $1.5 million every two years. Maine and New York City have adopted campaign finance matching systems similar to this; the result in Maine has been that there are more female and minority candidates and candidates from the middle class.

Audience

Congressman Sarbanes echoed the dissent in Citizens United in noting that voter participation continues to decline election after election, a phenomenon that he attributed to the outsized influence of money in politics. Congressman Sarbanes believes that voters increasingly opt out of elections because they believe that the deck is stacked by a campaign finance system that allows virtually unlimited special interest cash to influence campaigns through Super PACs and independent expenditures organizations that few voters see as truly independent of the campaigns. Congressman Sarbanes refuted the Court's conclusion in Citizens United that the only corruption of the political system comes from quid pro quo exchanges of political favors between donors and elected officials. Like the dissenting justices in Citizens United, Congressman Sarbanes stated that even the appearance of undue influence is corrosive and discourages individual participation in the electoral process.

The third panelist was District 20 State Senator Jamie Raskin, who has introduced legislation this session in Annapolis called "Shareholders United," legislation that is designed to address another erroneous assumption in the Citizens United decision. In justifying its decision, the Court opined that shareholders will be a check on corporations' political spending because, if shareholders do not approve of the political expenditures for Super PACS or other 501(c)(4)s, they will make their views known through shareholder resolutions. Senator Raskin's legislation requires corporations doing business in Maryland to obtain the approval of shareholders before they make political expenditures in Maryland state elections. Senator Raskin's legislation was prompted in part because he, like most Americans, saves for his retirement through mutual funds offered through his 401(k) plan. When he actually examined the corporations whose stocks he owned through his retirement funds, he found that he was invested in every company that is funding the American Legislative Exchange Council (ALEC), a conservative, corporate-funded political organization that funds issue campaigns and works to enact regressive pro-corporate, anti-union, pro-gun, anti-environment legislation in state legislatures throughout the country.

The Shareholders United legislation is part of a national movement in state legislatures to enact laws that will require corporations to gain the consent of their shareholders-a consent that the Supreme Court only assumed shareholders could express-in its reasoning in the Citizens United decision.

The panelists were also joined by District 18 Delegate Al Carr, who has introduced legislation that would expand Maryland's current disclosure requirements to require all large donations to be disclosed publicly within 24 hours of receipt by a campaign. As Delegate Carr explained this legislation is designed to allow voters to know right away which individuals, committees and corporations (which are allowed to make direct donations to Maryland state candidates) have donated to which candidates. Delegate Carr proposed this legislation in response to the U.S. Supreme Court's decision in McCutcheon v. Federal Election Commission, which invalidated Maryland's limit on the aggregate amount that any individual or entity can donate to candidates during an election cycle.

It was clear to all in attendance that we are very fortunate in Montgomery County to be represented by such passionate advocates for campaign finance reform, all of whom are committed to a revitalization of our democracy and its return to the American people. But, it was also clear that, with Republicans in control of the Congress, we may have to wait several years to see meaningful federal reform. Nonetheless, as all our speakers stressed, it is important for citizens to make our voices heard and to demand reform, and they commended the evening's attendees for coming out on such a cold night to show their clear support for this vital issue.